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Medicare ACOs in Premier Inc. Collaborative Outperform Peers in Shared Savings by 21 Percent
[February 18, 2020]

Medicare ACOs in Premier Inc. Collaborative Outperform Peers in Shared Savings by 21 Percent

Medicare Accountable Care Organizations (ACOs) participating in the Premier Inc. (NASDAQ: PINC) Population Health Management Collaborative (PHMC) have outperformed their peers by 21 percent in achieving shared savings since the start of the various Medicare ACO programs in 2012.

Premier PHMC Medicare ACOs, which total 7 percent of all Medicare ACO participants, have reduced spending by more than $665 million - 13 percent of net Medicare ACO savings nationwide since 2012. Moreover, when measured for performance, PHMC Medicare ACOs have consistently outperformed all other ACOs in quality since 2012. PHMC Medicare ACOs have participated in the Pioneer ACO Model and currently participate in both the Medicare Shared Savings Program and the Next Generation ACO (NGACO) Model.

"It is a great tribute to these organizations that they have outperformed the nation in improving quality and reducing costs in healthcare," said Joe Damore, FACHE, Vice President of Strategy, Innovation and Population Health at Premier. "Premier members achieving success in risk-based payment models have invested in building high-value delivery networks with the sophisticated contracting, care management and analytics capabilities needed to innovate care delivery. Most importantly, these members are leading the way in improving the health of their populations, which is rewarded in these new payment models."

Premier also found that health systems that have aligned together and formed Medicare ACOs maintained high quality in 2018. The eight PHMC Medicare ACOs that are part of recently integrated health systems achieved an above average quality score of 95.54 percent, with three of these ACOs attaining a score greater than 98 percent. These outcomes contradict a recent study asserting that consolidation is not associated with better quality of care, which included data from before the value-based care movement began.

Additionally, all NGACOs that participate in the Premier PHMC achieved shared savings in 2018, as compared to 76 percent of NGACOs nationwide. PHMC NGACOs make up 12 percent of participants but contributed to nearly 30 percent of the net savings in 2018. Premier PHMC NGACOs reduced total spending by more than $70 million in 2018, earning in excess of $63 million in shared savings. Premier NGACOs are national leaders in implementing successful two-sided risk arrangements, which comprise 36 percent of Medicare ACOs and are expected to continue to grow at a rapid pace.

"While Premier PHMC members have been successful in the NGACO model, the program is set to end in December 2020," said Seth Edwards, Vice President of Premier's PHMC. "We've been encouraging CMS to either extend the program or modify the Direct Contracting Model to ensure a smooth transition for NGACOs. It would be a shame to cut off the progress that so many have made in improving care for their patients and lowering healthcare spending overall."

Approximately 75 health systems across 33 states with hundreds of hospitals and thousands of clinicians work together in Premier's data-driven PHMC to assess, measure and improve population health management. Through the PHMC, leading health systems share lessons learned, insights, data and best practices with each other to accelerate transformation. Named Best in KLAS for Healthcare Management Consulting, Premier experts partner with healthcare organizations pursuing risk-based payment models in both government and commercial sectors to build the strategies and capabilities needed for success.

About Premier Inc.

Premier Inc. (NASDAQ: PINC) is a leading healthcare improvement company, uniting an alliance of more than 4,000 U.S. hospitals and health systems and approximately 175,000 other providers and organizations to transform healthcare. With integrated data and analytics, collaboratives, supply chain solutions, and consulting and other services, Premier enables better care and outcomes at a lower cost. Premier plays a critical role in the rapidly evolving healthcare industry, collaborating with members to co-develop long-term innovations that reinvent and improve the way care is delivered to patients nationwide. Headquartered in Charlotte, N.C., Premier is passionate about transforming American healthcare. Please visit Premier's news and investor sites on; as well as Twitter (News - Alert), Facebook, LinkedIn, Instagram and Premier's blog for more information about the company.

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